Improving the Performance of Procurement and Inventory Management of Hospital Materials (Case of a Taiwanese Medical Centre)

Abstract

Within healthcare organization, the main goal of material procurement and inventory management is to reduce the cost associated with supplies without sacrificing the quality of patient care. In general, there are two ways to maintain supply level, i.e., joint procurement and direct purchase from the point-of-use location. For joint procurement, the demand of the associated point-of-use will place order to central warehouse. The other way is the order is directly place to the supplier by the individual department. The focus of this study is to examine the current procurement and inventory management and improve the inventory policies for central storeroom and induvial department. To maintain the service by setting new order policies. In this study, we define a performance indicator, supply-demand ratio to measure the improvement of the operation of procurement and inventory management. With new policy, holding cost and idle stock, and usage of space can be reduced meanwhile it can maintain its service level.